Detroit Bureau on Twitter

Magna’s Opel Status Creates Problems for Rivals

VW squawks. Ford talks.

by on Sep.11, 2009

“When deals get done these sorts of things happen."

“When deals get done these sorts of things happen," Bill Ford told reporters.

While executives from Volkswagen AG have denounced the deal that proposes turning over Opel/Vauxhall to Magna International Inc. and its Russian banking partner, Ford Chairman William Clay Ford Jr. said that he and his company could live with the deal.

Meanwhile, VW executives have suggested that they may well have re-evaluate using Magna as a supplier if its bid for Opel/Vauxhall succeeds, which seems increasingly likely. VW’s concerns aren’t surprising. The deal, financed by the German government to save jobs, could elevate Opel’s game and turn it into a stronger, more serious competitor for VW in Central and Eastern Europe.

“The German on German rhetorical violence has really been something to see. It’s really escalated,” noted one observer familiar with the Europe automotive market.

Parts and Cars!

Parts and Cars!

The acquisition of Opel/Vauxhall will make Magna a direct competitor of Ford Motor, particularly in Europe and Russia, as well as a supplier to Ford. However, William Clay Ford Jr., said Magna’s acquisition from General Motors Company of a controlling interest of the European carmaker Opel/Vauxhall would not stop Ford from doing business with the big Canadian company.

“I’ve talked to them personally about it and for now we feel very comfortable about it. They’re an excellent supplier for us and we have a very good relationship and an excellent partnership,” Ford said.

“They’ve clearly said they will respect intellectual property and we believe them,” he said.

“When deals get done these sorts of things happen. We have a very good working relationship with the German government as we do with the American government,” he said. “Our ability to compete worldwide remains intact and we feel very good about it,” he said.

“Magna has been a very good company and I believe they will be a very good operator for Opel/Vauxhall,” he said.

“We take them seriously as a competitor,” Ford said.

Meanwhile, Magna chairman Frank Stronach said that Magna plans to operate the company’s supplier business separately from Opel.

“Upon the successful completion of the acquisition Magna will put in place appropriate ‘firewalls’ in order to ensure a complete separation between its current auto parts business and Opel so that the confidential and proprietary information of its customers is fully protected,” Stronach said.

Tags: , , , , , , , ,

Comments are closed.